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A CD, also called a certificate of deposit, is a type of savings account. CDs offer a fixed interest rate, or annual percentage yield (APY), which is usually higher than your average savings account interest rate. They also have a fixed maturity rate, so you can’t withdraw your funds anytime you want. You'll have to rate until your CD matures, or risk paying a sometimes-hefty penalty. Whether you’re saving for the trip of a lifetime in three months or putting away money for your child’s first year of college in ten years, CDs are worth exploring. (Though in the case of the latter, be sure to check out a 529 savings plan.)
Terms of your CD can range from three months to 10 years, so it’s important to keep your long-term financial goals in mind when considering opening one. You don’t want to put your money into a 10-year CD with a great interest rate, only to lose money if you need to make a withdrawal before your CD matures.
But if you’re risk-averse, good news. CDs are widely considered one of the safer investment options out there. Plus, most CDs offer FDIC insurance for up to $250,000. If you think this kind of account may be right for you, then read on for our picks of the top CD rates.
Don’t have a chunk of change to put into your CD? No problem. Capital One’s 360 two-year CDs require no minimum deposit, in addition to all the usual bells and whistles: no market risk, guaranteed APY and FDIC-insured. You can even choose how you’d like your interest paid out.
Capital One 360 is the online branch of Capital One and offers financial products ranging from checking accounts intended for your teen to 401(k) accounts to money market accounts, plus traditional checking and savings accounts.
Here’s the rub: Capital One 360 is mostly an online-only bank, with the exception of its Capital One cafes. These trendy co-working spaces have Capital One ATMs – and even financial professionals on hand. But the best part? The 50% discount on any drink if you’re a Capital One 360 cardholder.
An online-only bank Ally offers a competitive 2.50%, two-year CD with – wait for it – no minimum deposit. Interest is compounded daily, there are no fees or minimum account balance requirement, and your funds are FDIC-insured.
Ally Bank also offers other financial products. Think credit cards, home and auto loans, even investment products. Keep in mind that Ally Bank is the reincarnation of GMAC Bank. The rebranding occurred in 2009.
Remember the iconic black and orange credit cards? Yep, they’re still around. Discover Bank offers an impressive 2.70% interest rate for a 10-year CD.
While the minimum deposit of $2,500 is a bit hefty, the APY is high, and the benefits abound. For example, Discover has a robust online banking presence, you can withdraw interest before your CD matures, and their customer service has a great reputation.
Other things to keep in mind: with Discover, your CD funds are FDIC-insured. You’ll also be notified 30 days before your CD matures.
Discover was founded in 1911, has more than $98 billion in assets, and boasts a customer-first approach. You can get anything from a travel credit card to a home equity loan to a credit card for your college student. The only thing you can’t get? A branch near you –unless you live in Greenwood, DE, the home of the company’s only branch.
Want to learn more? Check out our full review of Discover Bank.
If you have the funds to put down initially, then the Citizens Access six-month CD is a great option. Here’s why: it has a 2.00% APY, no fees, and promises of no teaser rates. This CD is also FDIC-insured and has flexible interest payout options – you can choose to add it to the principal of your CD or have it transferred to a linked account. Plus, opening one online is a snap.
Keep in mind that Citizens Access doesn’t have a mobile app, so if you like to manage finances from your smartphone, this may not be for you. The online division of Citizens Bank, Citizens Access has more than $150 billion in assets.
Barclays offers online CDs ranging from three months to five years, with an APY as high as 2.75% with no minimum balance.
Our favorite aspect of a Barclays CD is its built-in CD calculator. Using the tool, you can punch in your time frame and initial deposit and see your earning potential on a handy, easy-to-digest graph. Want to make a bit more? Then bump up your CD’s maturity date or initial deposit, and watch your savings grow. Overall, Barclays’ site boasts a smooth digital experience — not to be taken for granted in the world of fintech — where sometimes websites can be cluttered or hard to navigate.
If you want more information, you can read through our full review of Barclays.
Most people associate the Sallie Mae brand with those pesky student loan bills you get each month. But the financial institution offers pretty competitive rates on CDs, like its 2.55% APY on a two-year CD.
You’ll need a $2,500 minimum deposit to open the account, but after that, you’ll enjoy perks like no monthly fees FDIC insurance, and guaranteed returns. There’s an automatic renewal option as well.
Founded in 1974, Sallie Mae originally started as a government entity that provided federal student loans to college students. Today, it’s a publically-traded company. Sallie Mae is the largest creator of federally-insured student loans, but also offers other financial services like money market accounts and CDs.
You’ve probably seen the ads for Goldman Sachs’ newest offering, Marcus. Named after one of the bank’s founders, Marcus Goldman, think of Marcus as the cool little brother – If Goldman Sachs were a 148-year-old big brother, that is.
Offering CDs with terms ranging from six months to six years, Marcus promises a guaranteed return and a great rate of 2.80% APY for a five-year CD. You’ll also only need a $500 minimum deposit, which is low considering the high APY.
It's worth noting that Marcus doesn’t offer checking accounts or ATMs, and they have very few branches. Your CD will also automatically renew, so be sure to keep an eye on its maturity date in case you want to withdraw funds or change your CD’s terms.
Founded in 2016, Marcus is Goldman Sachs’ consumer lending (and banking) arm. Marcus offers personal loans, savings accounts, CDs, and more.
For more information, you can read through our full review for Marcus by Goldman Sachs.
Not only is Synchrony Bank’s two-year, 2.50% rate competitive, this offering also comes with a few other major perks. Synchrony offers a super-flexible withdrawal policy. But don’t get too excited – it only applies to your interest. Basically, you can withdraw your interest from your Synchrony Bank CD at any time without penalty.
The company also offers a great perks program with extras like complimentary identity theft resolution services, travel discounts, added value content and, for diamond members, your own dedicated customer service line.
Synchrony Bank was founded in 1932 and has $56.5 billion in deposits and 74.5 million customers. You can also read through our full review of Synchrony for more information.